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Success Story: Saving nearly $100,000 before turning 30
For Marie Peters, saving is more of a lifetime endeavor than a monthly afterthought.
“Savings reduces a lot of stress that I feel like people go through,” says Peters, 27, of Alexandria, Va. “It really provides peace of mind.”
She and her husband, Ed, have already accumulated nearly $100,000 -- no small feat, especially considering that the first $100,000 is always the hardest $100,000 to save.
To be closing in on that milestone while still in their 20s is a serious accomplishment. And it's in line with a recent study from TD Ameritrade, which found that members of Generation X and Y are saving more diligently than their parents and grandparents.
They currently have about $40,000 in savings accounts and $20,000 in an IRA. In addition, Peters notes that she has $21,000 in her 401(k) plan and her husband has $12,000 in his employer's retirement plan.
Marie Peters credits vivid childhood memories of her parents’ arguments while balancing their checkbook as a motivator for stockpiling cash for retirement and rainy days.
“I never wanted to fight with my spouse about money,” she says.
Thankfully, her husband is of the same mind-set -- although she says that while he claims to have been a “good saver,” she’s more of a “super saver.”
Peters began saving diligently in college, having her paychecks direct-deposited into an account back home in Pittsburgh. When she needed money, her mom would send her a check from the account that she would cash on campus.
Although her parents paid half of her tuition and she had scholarships, she still graduated with about $25,000 in student loan debt.
Peters found this unsettling.
“Debt has always made me uncomfortable, just knowing that I owed someone something,” she says. “I just don’t like having that out there.”
So while her other recently graduated friends were buying new cars and were “more concerned about new clothes and purses, not impending loans,” Peters dedicated herself to steadily paying down that student debt.
Her first job out of college required intensive travel, paid for by her employer, so she had few personal expenses. She estimates applying as much as 75% of those paychecks toward her student loans and saving $100 from each check into her old account.
When that job ended, she moved back in with her parents for nine months while working and job searching.
“I really worked to keep expenses low,” she says, although she did splurge on flights to see her boyfriend, now her husband.
Her reward: She paid off her student loans about a year after graduating.
Once starting her career in marketing in the Washington, D.C., area, Peters kept saving, maxing out what her company matches for her retirement plan and making those $100 deposits into her old account.
When she and her husband married two years ago, they also began diverting $500 into a joint savings account each month as well as another small amount into a savings account for surprise gifts to each other.
Peters explains that her constant analyzing of their accounts made it difficult -- if not frustrating -- for her husband to surprise her without annoying her.
But the couple doesn’t deny themselves to the point where they’re constantly wanting, Peters says. They go out to dinner at least once a week, have video games and an iPad, take small trips to see family and visit nearby cities, like New York, and even vacationed in Curacao.
All purchases and trips are planned, she says, to eliminate those spur-of-the-moment decisions that leaded to unexpected expenses.
Peters notes that there are guidelines for dipping into savings: It has to be an emergency expense or one that they can’t pay for by trimming their spending that month.
“Living in D.C., paying rent was just a little bit less than buying a house,” she says, so they took money from their savings to make a down payment on a home.
Although she's dealing well with having mortgage debt, Peters says they typically pay more than their monthly payment and make extra payments when their budget allows.
Even with a home, and healthy savings and retirement accounts, Peters says that saving will remain a No. 1 priority for the couple.
“It’s part of our lifestyle and who we are,” Peters says.
Her tips:
- Pay yourself first. Sure, financial experts always tout this, but Peters has proven it’s an effective saving method -- especially when you have the money deposited into and account and never see it.
- Recognize the difference between wants and needs, and spend accordingly. “Meet your needs first, your wants second.”
- Save and wait. That goes for small to big purchases, like cars, vacations and a home. “I look at those things as goals, something to work for.”
- Be frugal where you can. Peters always shops with a list and buys mostly store brands.
- Watch your daily routine. Make lunch out with coworkers or breakfast on the go a treat, not the norm.
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